According to a report I read from Kiplinger, starting in 2011, the cost of employer-provided health insurance will be reported on your W2 form. However, these costs will NOT be taxed as income – they are only being reported.
Apparently the idea is to give employees a better idea of how much money their employers are spending on them aside from wages. If that is the case, I’d say be prepared for additional items being reported that some employers pay for, including:
- Dental Insurance (if it is not included in the health insurance)
- State and Federal Unemployment Taxes
- Contributions to Pension / Profit Sharing plans if not already reported
- Life Insurance Premiums not currently being reported
- Classes, CPE and other courses taken that the employer picks up the tab
- Reimbursements to employees such cell phone reimbursements, travel, meal allowances, etc.
I agree with employers telling employees how much aside from salary is being paid out. At some places I’ve been associated with, an employee is given a printout showing how much they will make with their salary (or raise/bonus) and on that sheet is the amount that will be paid in benefits.
However, don’t think this is an easy thing for employers. Not all employers keep track of every benefit paid by employee. Now, the employer will need to keep records in order to keep in compliance with IRS guidelines. There are additional costs for record-keeping…
If you have any comments or questions – please let me know!